Jefferies to Investors: ‘Home Health Is Where It’s At’

Home health demand is expected to rise significantly, and several factors make the industry a worthwhile sector for investors, says global investment banking firm Jefferies in a recent report.

Factors that bode well for the industry include an improved reimbursement outlook; rising interest in alternative payment models, specifically bundled payments (BPCI); and consolidation/merger and acquisition activity continues to be a growth driver for most companies.

Ultimately, home care is one of the key tools that could be used to drive overall health care costs down, the banking firm asserts.

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“Home health is where it’s at,” says Jefferies in a statement. “We encourage investors to revisit the home health sector given our view that this group will see meaningful growth as demand for their low-cost services (both post-acute and pre-acute) grows as a result of improving hospital trends and the introduction of value-based payment models such as BPCI.”

In addition, improved reimbursement visibility is an incremental positive that should “embolden management teams to ratchet up M&A” activity, the banking firm says.

Written by Cassandra Dowell

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